DOJ targets banks, others in new money laundering offensive

"What we don't want to do is have a bidding contest between the criminal prosecutorial powers of law enforcement and the oversight and supervisory powers of the regulators," Djinis said.

NEW UNIT

In 2010 the Department of Justice created within the asset forfeiture section a specialized unit, money laundering and bank integrity, which it staffed with about 14 prosecutors who focus exclusively on financial institution cases.

The unit, which is also handling the sanctions and stripping-related cases including the one against Standard Chartered, is focused on fortifying the U.S. financial system against money laundering and illicit finance, Shasky Calvery said.

"The way we do that is by aggressively enforcing the Bank Secrecy Act," she said.

The term "stripping" refers to the practice of banks removing or masking information regarding transactions.

Shasky Calvery is leaving the Justice Department next month to head FinCEN, the U.S. Department of the Treasury's anti-money laundering unit.

Her deputy, Jai Ramaswamy, will serve as acting chief of the unit and said he planned to keep it on the same track.

Part of the shift in focus appears to be a greater interest in cases which show ongoing illegal conduct rather than going after banks and institutions that broke the law in the past but have not continued to do so.

The headline-grabbing cases involving allegations that some of the world's largest banks concealed Iran-linked transactions are related to historical conduct. The Standard Chartered case, for example, deals primarily with conduct that occurred before 2008.

The newer focus cases in contrast involve some more recent activity. The check cashing case, for example, involved conduct that lasted through June 2011, prosecutors said.

Earlier this month the Department of Justice charged what it described as a multi-million dollar money laundering conspiracy to help move drug money in Texas, and said the conduct had occurred through 2011.

Such cases also represent something of shift to charging so-called professional money-launderers, as opposed to adding money-laundering charges to an underlying drug or corruption case.

Another priority of the unit is examining potential misconduct in new types of technology such as mobile payments, Shasky Calvery said.

(Reporting By Aruna Viswanatha in Washington and Brett Wolf in St. Louis; editing by Andrew Hay)